Market and investment

Development project (developerský projekt)

In Czech: Developerský projekt

A development project (developerský projekt) is the construction or conversion of a residential building or group of buildings, planned and financed by a developer to sell or rent out flats, houses or other units.

Also called: new development, off-plan project, residential project, developerský projekt, projekt developera

What it means

A development project, in Czech developerský projekt, is a scheme in which a developer, a company specialising in construction, buys a plot or an old building, obtains the permits, builds or converts a building and sells or rents out the individual flats, houses, garages or commercial units.

Buyers often come in before the building is finished. They buy from visualisations, floor plans and a specification of fittings, and pay part of the price in advance. That gives a choice of layout and sometimes custom changes (klientské změny), but also the risk of delays or differences from what was promised.

How it works in the Czech Republic

Buying from a developer usually starts with a reservation agreement (rezervační smlouva) and a reservation fee. Then comes an agreement on a future purchase agreement (smlouva o smlouvě budoucí kupní), in which the parties commit to sign the purchase agreement once the building is finished. Under the Czech Civil Code, a party commits to conclude the future contract after being called upon to do so within the agreed period, or within one year if no period is agreed. If the entitled party does not call in time, the obligation lapses.

The purchase agreement for a flat must be in writing. The buyer becomes the owner only when the transfer is entered in the land register (katastr nemovitostí), with effect from the moment the application reached the cadastral office. A building that requires occupancy approval under the Building Act may be used only on the basis of an occupancy decision (kolaudační rozhodnutí).

Payments are usually split into instalments tied to construction progress. A developer may receive the money directly, through escrow with a lawyer, notary or bank, or through a project account at the financing bank. Lovec-Realit.cz lists development projects in a dedicated section.

Practical example

For example, a buyer picks a 2+kk flat in the second phase of a three-phase project. She signs a reservation agreement with a reservation fee of, say, CZK 100,000, within a month an agreement on a future purchase agreement, and under the payment schedule pays 10 % of the price on signing and another 20 % when the shell of the building is complete. She pays the rest with a mortgage after the occupancy approval, when the purchase agreement is signed and the land register application is filed. The amounts and percentages are illustrative only.

What to watch out for

  • Check the developer: its completed projects, ownership of the plot on the title deed (list vlastnictví) and the status of the building permit.
  • In the future purchase agreement, watch the completion date, penalties for delay and the deadline for calling on the other party to sign the purchase agreement.
  • Find out where your advance payments go, under what conditions, and how they are returned if the project does not go ahead.
  • Get the specification of fittings and the price of custom changes in writing.
  • Have a lawyer review the contracts before you sign.

Frequently asked questions

What is the difference between a reservation agreement and a future purchase agreement?

A reservation agreement holds the flat for you for a set time. In an agreement on a future purchase agreement, the parties commit to sign the actual purchase agreement later, usually after the building is finished.

When do I become the owner of a flat in a development project?

When the transfer is entered in the land register on the basis of the purchase agreement. The entry takes effect from the moment the application reached the cadastral office.

On Lovec-Realit.cz

  • New build (novostavba)A new build (novostavba) is a newly built flat or house that nobody has lived in yet, whether finished or still under construction. Advertisers differ on how old a building can be and still be called a new build.
  • Reservation agreement (rezervační smlouva)A reservation agreement (rezervační smlouva) is a contract in which a buyer pays a reservation fee and the seller or estate agency agrees not to offer the property to anyone else for a set period. It does not transfer ownership.
  • Agreement on a future purchase agreement (smlouva o smlouvě budoucí kupní)An agreement on a future purchase agreement (smlouva o smlouvě budoucí kupní) obliges the parties to sign a purchase agreement later on terms agreed now. It is used when a sale cannot be completed yet, for example for a flat under construction.
  • Occupancy approval (kolaudace)Occupancy approval (kolaudace) is the procedure in which the building office allows a finished building to be used. Where Building Act No. 283/2021 Sb. requires it, it ends with an occupancy decision, without which the building may not be used.
  • Entry into the land register (vklad do katastru)Entry into the land register (vklad do katastru nemovitostí) is the registration of ownership or another property right in the land register based on a contract. Only this entry makes the buyer the owner, with effect from the day of filing.
  • Purchase price escrow (úschova kupní ceny)Purchase price escrow (úschova kupní ceny) means the buyer deposits the money for a property with a lawyer, notary or bank, who pays it to the seller only when agreed conditions are met, usually once the buyer is in the land register.

Sources

Laws and official pages this text is based on (in Czech).

This text is for information only and has not yet been checked by a legal or financial expert. It is not legal, tax or financial advice. Verify important details in the listed sources or with a professional.

Updated 25 October 2026

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